A production function is said to be homogeneous of degree ( if ((xL, xK) = x(((L, K),
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A production function is said to be homogeneous of degree ( if ((xL, xK) = x(((L, K), where x is a positive constant. That is, the production function has the same returns to scale for every combination of inputs. For such a production function, show that the marginal product of labor and marginal product of capital functions are homogeneous of degree ( - 1?
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If fxL xK x fL K then differentiating ...View the full answer
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Related Book For 
Microeconomics Theory and Applications with Calculus
ISBN: 978-0133019933
3rd edition
Authors: Jeffrey M. Perloff
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